Water birds fly up and down the Jones Falls between the two sides of the mill, which straddles the stream. So he insisted that an image of one be included on the rooftop sign that faces Interstate 83, announcing the presence of the commercial-residential complex called Mill No. 1.

When residents begin moving into the converted mill early next month, the valley between the Baltimore neighborhoods of Woodberry and Hampden will shift from being a predominantly industrial area to being an extension of the surrounding neighborhoods.

Thirty years after the first significant mill redevelopment here, the vestiges of centuries of heavy industry along the waterway are on the way out. Although some nearby residents worry about congestion, the redevelopment may be a boon for the long-ignored urban river.

"It is a unique setting in Baltimore City that most people haven't experienced," Tufaro said of the Falls Road property, listed on the National Register of Historic Places.

The main structure, a five-story brick building built in 1873, and another nearby structure on the Jones Falls' eastern shore will contain 84 apartments, office space, room for two restaurants and a fitness center, plus parking for about 165 vehicles.

On the western shore, a warehouse building abuts what was once the railroad line, now the tracks for the light rail. The four-story warehouse, built with reinforced concrete in the late-1910s, is set to become office space and an environmental classroom. It's only accessible by two pedestrian bridges — one nearly a century old and a modern addition.

"It's better to have them survive in some form than lose them altogether," said John McGrain, a historian and expert on Baltimore's mills. Unless they are preserved, future generations won't believe that operations "so gigantic operated with such powerful energy from water and steam," he said.

In the fall of 2009, when Tufaro's company, Terra Nova Ventures LLC, agreed to buy the mill — known as Mount Vernon Mill No. 1 in the 1800s — it was occupied by Lifoam Industries LLC, a descendant of Life-Like Products, which made model trains and foam products. Like the other industrial sites along the river, it was a deteriorating eyesore.

The windows of the main building had been bricked in. The route of the Jones Falls had shifted over the decades, causing the concrete structure on the western shore to hang precariously over the river. Likewise, the bridge connecting the buildings was threatening to collapse.

"We knew we had to deal with the challenges of the river," said architect Charles Alexander, a principal of Alexander Design Studio in Ellicott City. "Successive flooding had severely compromised the structure," he said, and another significant flood could have meant the warehouse's end.

To secure the warehouse, and open the interior to natural light, they received permission from the Maryland Historical Trust and the National Park Service, which oversee the National Historic Register, to cut a corner out of the structure. Removing the corner, like a slice out of a cake, freed them of the building's trouble spot, Alexander and Tufaro explained.

Now, glass walls line the slice, which will allow occupants to gaze up the stream as they work.

The water dictated much of what could be done at the site. During Hurricane Agnes nearly 41 years ago, the water level "came fully up to the bottom floor of the warehouse" and into a lower level of the main mill building where there is now a parking garage, Tufaro said. The building was designed with flooding in mind, including special barriers built into the lower-floor walls, he said.

The conversion of Mill No. 1 comes after the rehab of similar properties nearby. Mill Centre, across Falls Road from Mill No. 1 and formerly called Mount Vernon Mill No. 2, was the first major renovation of an industrial site in the Jones Falls Valley. Completed in the 1980s, it was followed by the redevelopment of Meadow Mill, a former London Fog rainwear production site, Clipper Mill — which was not a mill but the Poole and Hunt Foundry — and, most recently, Union Mill, a textile factory originally known as Druid Mill.

"I applaud the other mill developments. … Having the mill corridor being more attractive is useful," said Samuel Himmelrich Jr., who developed Meadow Mill and Mount Washington Mill, several miles north of the Woodberry-Hampden valley. These former industrial sites continue to draw business people who want to work near their homes and occupy unusual spaces, he said.

So far, two commercial tenants have signed on at Mill No. 1 and about one-third of the apartments are leased, Tufaro said. Terra Nova is in discussions that should be formalized with two months with two local restaurateurs to open businesses in the restaurant spaces, he said.

Apartments at Mill No. 1 are listed from about $1,400 to $3,100 per month, said Steve Travieso of Thornhill Properties Inc., which manages the complex. Office space runs from about $16 to $27 per square foot, Tufaro said.

"If I were to say I had a mission statement, that building is right in line with where we are," said Denise Sullivan, principal of Urban Green Environmental, a company that conducts environmental assessments for land owners. Her firm worked on Mill No. 1 and is moving into the lowest level of the warehouse space, not far from her home in Wyman Park. "That view of the stream, to me it's cathartic."

Evergreen Health Cooperative, a health insurance firm borne of the Affordable Care Act that is directed by former Baltimore health commissioner Dr. Peter Beilenson, chose a space in Mill No. 1 because of its central location and welcoming atmosphere, said Nancy Lewin, the company's vice president of communications.

Tufaro ran as a Republican against Martin O'Malley in the 1999 mayoral contest and has helped develop many projects throughout the Mid-Atlantic region, including the Montgomery Park office building in Southwest Baltimore and Waterloo Place Apartments in the city's Mount Vernon neighborhood.

He's under contract to purchase one of the valley's last remaining industrial sites, just up the road from Mill No. 1. He plans to convert the property, which houses Komar Co. Inc., a wholesale distributor of adult toys and novelties, into residences, retail and office space. He's thinking of calling it Whitehall Mill and would like a restaurant there to offer a beer garden-style atmosphere, he said.

The only significant industrial building in the valley that remains to be converted is what used to be the Woodberry Mill. Part of the Clipper Mill Industrial Park, it is recognizable to highway passersby because the red brick behemoth is marked by a smokestack that says Schenuit Rubber down the side, an addition by the tire manufacturer that occupied the space after its time as a cotton mill.

The building is owned by a limited partnership involving the principals of the Time Group, a real estate investment firm based in Owings Mills, according to Leslie Ries, an attorney for the partnership.

Several years ago, the partnership launched a design competition for the building, Ries said. Plans included both residential and commercial uses, but development was waylaid by the time it took to get an easement agreement from the Maryland Transit Administration, she said. The light rail line runs across the building's access road, Ries explained.

Then, in 2010, there was a fire in the building that destroyed a significant portion of the property, including the roof, she said.

"We're just entertaining ideas of what to do there," including selling the building or even tearing it down, Ries said.

Residents who live near the mills are torn about the redevelopment, said George Peters Jr., zoning and land use chairman for the Hampden Community Council. He lives a block up the hill from Mill No. 1, he said, and knows he'll enjoy the restaurants there but also curse the mill visitors and residents who occupy parking places in the neighborhood and congest the streets.

"We're here because of the small-town feel of Hampden," Peters said.

Tufaro said Terra Nova is working to mitigate parking issues. The restaurants will offer valet parking and they are coordinating the use of nearby lots, he said.

Although residents may be conflicted about the mills' renewal, it seems that it may have a positive affect on the waterway itself.

Terra Nova has worked to rehabilitate the shoreline around the development and having more residences near the Jones Falls means more people will care about what it looks like, said Ashley Traut, senior program manager for stormwater management and community outreach with Blue Water Baltimore.